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Stocks Remain Mostly Positive In Mid-Day Trading - U.S. Commentary


After moving to the upside early in the session, stocks remain mostly positive in mid-day trading on Wednesday. The major averages are bounding following a recent sell-off, with the tech-heavy Nasdaq bouncing off its lowest closing level in over seven months.

In recent trading, the major averages have moved roughly sideways, hovering firmly in positive territory. The Dow is up 163.86 points or 0.7 percent at 24,629.50, the Nasdaq is up 102.09 points or 1.5 percent at 7,010.91 and the S&P 500 is up 26.06 points or 1 percent at 2,667.95.

Bargain hunting contributed to the early upward move on Wall Street as traders looked to pick up stocks at reduced levels following the steep drop seen over the two previous sessions.

Upbeat earnings news from companies like Foot Locker (FL), BJ's Wholesale (BJ), and Autodesk (ADSK) also contributed to the rebound.

Buying interest is relatively subdued, however, as traders digest a slew of U.S. economic data, including a report from the Commerce Department showing a much steeper than expected drop in durable goods orders in October.

The Commerce Department said durable goods orders plunged by 4.4 percent in October following a revised 0.1 percent dip in September.

Economists had expected orders to slump by 2.5 percent compared to the 0.7 percent increase that had been reported for the previous month.

Excluding a steep drop in orders for transportation equipment, durable goods orders inched up by 0.1 percent in October after a revised 0.6 percent decrease in September.

Ex-transportation orders had been expected to rise by 0.4 percent compared to the 0.1 percent uptick originally reported for the previous month.

A separate report from the Labor Department showed first-time claims for U.S. unemployment benefits unexpectedly edged higher in the week ended November 17th.

The report said initial jobless claims rose to 224,000, an increase of 3,000 from the previous week's upwardly revised level of 221,000.

Economists had expected jobless claims to slip to 215,000 from the 216,000 originally reported for the previous week.

Meanwhile, the National Association of Realtors released a report showing a bigger than expected rebound in existing home sales in the month of October.

NAR said existing home sales surged up by 1.4 percent to an annual rate of 5.22 million in October after plunging by 3.4 percent to a rate of 5.15 million in September. Economists had expected existing home sales to jump by 1.0 percent.

Sector News

After leading the way lower in the previous session, energy stocks are turning in some of the market's best performances in mid-day trading.

A significant rebound by the price of crude oil is contributing to the strength in the energy sector, with crude for January delivery jumping $1.95 to $55.38 a barrel after ending the previous session at its lowest closing level in over a year.

Reflecting the strength in the energy sector, the NYSE Arca Oil Index and the Philadelphia Oil Service Index are both up by 2.9 percent and the NYSE Arca Natural Gas Index is up by 2.8 percent.

Gold stocks are also seeing considerable strength amid an increase by the price of the precious metal. With gold for December delivery climbing $7 to $1,228.20 an ounce, the NYSE Arca Gold Bugs Index is up by 2.6 percent.

Steel, software, housing, and financial stocks have also moved notably higher on the day, while utilities and pharmaceutical stocks are bucking the uptrend.

Other Markets

In overseas trading stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index fell by 0.4 percent, while Hong Kong's Hang Seng Index climbed by 0.5 percent.

Meanwhile, the major European markets all rebounded following recent weakness. While the French CAC 40 Index jumped by 1 percent, the U.K.'s FTSE 100 Index and the German DAX Index surged up by 1.5 percent and 1.6 percent, respectively.

In the bond market, treasuries are giving back ground after trending higher in recent sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3.7 basis points at 3.085 percent.

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